SBI readies $ 1 bn war chest for acquisition overseas
State Bank of India, the country's largest bank, is raising the bar for acquisition. Having tasted minor success with small buyouts, the public sector giant is ready with a $ 1 billion war chest to take over a niche bank which not just gives it access to foreign markets but also helps it blunt the advantage of international players who are poised to enter India in 2009. "We have been acquiring smaller banks and need to have a bigger bank in niche markets like derivatives," said a bank official.
While SBI is eyeing over 20% growth in the domestic market, it has also set sights on increasing the share of international banking in its portfolio. Though organic expansion through a deeper branch presence is one of the routes being pursued in markets like the US, bank executives said India's largest commercial bank would not shy away from acquistions even in Europe.
But given the valuations, even a $ 1 billion acquisition in Europe or in Asia would be small, considering the scale of operations. The government too wants India's state-run banks to increase their balance sheet size and was earlier toying with the idea of merging some entities. Though it had to give up its plans due to political opposition at home, it is egging them on to acquire global footprint and muscle.
"The size of the bank and what we finally acquire depends on the choice on the table. But the idea for niche acquisitions is to shorten the learning curve," a bank official said. With a bank, which has a strong derivatives trading platform in the kitty, SBI can hope to offer more specialised service to its clients at home who would otherwise shift to a Citibank or Barclays once India opens its doors to more foreign banks from April 2009.
SBI's acquisitions so far have been restricted to banks like like Giro Commercial in Kenya, Indian Ocean International Bank in Mauritius and PT Bank IndoMonex in Indonesia which were more to establish footprints in these markets.
State Bank has been talking of acquiring a bank in Bangladesh for a while but the move has not fructified yet. While the bank had made its intention of raising its acquisition size from under million so far to 0 million last year, the fresh target is a significant step up and is being seen as preparation for facing competition in the liberlalised era.
Even smaller public sector players like Bank of India have spent more on overseas acquisitions.
Blackstone set to invest $ 100 mln in Gokaldas Exports
Blackstone Group, a global private equity fund with $ 85 billion assets under management, is close to investing $ 100 million in publicly listed Gokaldas Exports, one of India's largest apparel exporters, reports the Business Standard. According to market information, Blackstone is likely to pick up 10-15% stake for this investment to fuel Gokaldas' expansion. A company spokesperson declined to comment on this development. If this investment sails through, it is expected to be one of the largest private investment in a public enterprise (PIPE) in the apparel sector.
Gokaldas is a Rs 1,000 crore apparel exporter, which is looking at tapping into the domestic Indian market as the rising rupee is hitting exporters hard. The majority of this sum is expected to be used to fund its 400-acre, Rs 2,000 crore-special economic zone at Kanakapura, on the outskirts of Bangalore. A spokesperson said they were going through the process of getting approvals for this project, which is expected in the current financial year.
Gokaldas Exports operates through 46 factories in south India, predominantly in Karnataka. During 2006-07, it commissioned two new factories in Mysore and Tumkur and a Rs 15 crore plant will come up in Hyderabad in a few months.
The company currently has an annual capacity to stitch out 30 million garments such as outerwear, innerwear, bottoms, shirts, knitwear etc. Globally, it supplies to companies like Nike, Adidas, GAP, Tommy Hilfiger and Abercrombie and Fitch.
According to a company official, Gokaldas is keenly looking at the retail scene panning out in India and is hoping to leverage this boom. "The domestic market growth is quite promising and a few well-known players have been added to our list of buyers. We expect a good growth in the domestic market and with the entry of bigger retail players, we expect a larger growth and activity in the Indian retail scene," the official said.
The local market currently accounts for 5% of the total sales and this is expected to double in the coming years. According to Gokaldas, it is expecting a top line growth of 15% during FY08. The company is one of the largest employers in India employing close to 60,000 people.
L&T, Essar, Korean major STX keen on setting up shipyards
Indian shipping industry is set witness a lot of action. Shipping biggies like L&T, Korean major STX, Essar, Shapoorji Pallonji and Bharti Shipyard are keen on setting up two mega shippyards at a total cost of over $ 1.5 billion.
The shipyards, both on west and east coast, will entail a minimum investment of Rs 3,000 crore for each shipyard. Sources said L&T and STX have sought to build both the shipyards. Thus, if L&T gets both the shipyards, the comapny will have to meet the project cost of Rs 6,000 crore.
"A single shipyard can handle around 2 lakh dead weight tonnage which is the international standard. Japan and Korea are well equipped to handle such tonnage," a government official said. The sites identified by the shipping ministry are Kakinada, Ennore and Tuticorn on the east coast and Mundra and Pipavav on the west coast.
L&T senior executive vice-president MV Kotwal said: " We have shorlisted three locations. We would first set up a shipyard at one of these. In future, we may take up other also. For that matter only we have sent expression of interst to the government."
Energy and commodity sectors are going to fuel the growth in the ship-building industry of the country. The ship-building industry is soon expected to witness boom period as immense growth is happening in the oil and power sector.
"As the refining capacity in the countries increases the demand for crude oil will go up, leading to increased demand for tankers. More and more power generation capacity is being created, particularly thermal power, which will require more coal. As Indian coal has more ash content, coal will be imported in huge quantities, which will require more ships," said a shipping industry analyst.
To bring India at par with Korea and Japan will be a hard task for the government. "If Indian companies ally with Korean, Japanese or other technologically-strong companies, then India may be able to compete with Korea and Japan in the long run," added the analyst.
Ceat to move plant out of city; unlock 31 acres of land in Bhandup
It would be one of the last industrial units to shift out of the clogged metropolis of Mumbai. Leading tyre maker Ceat, an RPG group company, is moving out lock, stock and barrel to Patalganga, around 60 km away from Thane in Maharashtra.
This would involve relocating a 3,000-strong workforce, with the company planning to sell off the existing 31 acres of factory land in the Mumbai suburb of Bhandup.
The 49-year old plant, with a capacity of 250 tonnes a day, will be dismantled and moved to Patalganga in phases without disturbing production significantly. Senior Ceat officials said a part of the plant may be shifted to its Nashik facility, where capacity is being augmented to feed growing demand.
Ceat MD Paras Chowdhury confirmed to ET that the company has shortlisted Patalganga for the plant. "We need around 60 acres of land and want to buy it from MIDC. The process is currently on. A deal with MIDC helps us immensely, since it provides all kinds of infrastructure and utilities, making land acquisition easier," he said.
In the first year at Patalganga, Ceat will set up a greenfield facility for truck and bus radials, which would be later used to produce car & tractor and specialty tyres such as off-roads and mining tyres with an estimated cost of Rs 500-600 crore. The project will keep pace with the ever-increasing demand from original equipment manufacturers (OEMs).
The Ceat move is expected to bring windfall gains for RPG group. The Bhandup plant annually pays around Rs 12-13 crore to the municipal corporation as octroi. Savings would be substantial, given that the company posted Rs 39 crore profit the last fiscal, on the back of a total income of Rs 2,135 crore. During the first quarter of the current financial year, it posted a profit of Rs 30 crore on the back of Rs 540-crore income.
Company officials cite other reasons too for the relocation. "It makes no sense to lock up expensive land. Around 31 acres of land would fetch around Rs 500 crore at the current market rate. The company is in the process of selling 6.5 acres for which many property developers have queued up."
Over the last few years, capacity addition at the plant had been restricted due to space constraints. "Trucks face many parking issues. Almost every industry has moved out and residential complexes are coming up all over the place," said the official.
Michael Lewis, a worker at Ceat Tyres and a top official of the Citu-affiliated Mumbai Shramik Sangh (MSS) said the company has been facing the ire of local residents. "Earlier, Bhandup was part of an industrial belt, but it is now a residential area. Though the company is steadily replacing its old machinery, some amount of carbon emission and air pollution is unavoidable," said Mr Lewis.
Being a labour-intensive industry, the shift may not be a cakewalk for the management. "It is the reality of life. The company has to shift out tomorrow, if not today. We are only trying to protect the company and its employees," said Mr Chowdhury.
Ceat would love to retain and accommodate its entire workforce, said an official. "We are shifting a running plant and have to ramp up capacity in no time. Hence, we do not have the luxury of training new workers," he added. Since the company is going to celebrate its golden jubilee next year, there are many workers who are close to retirement age.
"Around 100-150 workers are routinely retired every year," the official said. Ceat may also look at announcing a VRS for those who do not want to relocate. On Monday, Ceat shares ended at Rs 166 on BSE, marginally down from the previous close of Rs 169.20. It has shown a steady growth from Rs 78, the 52-week low touched on August 7, 2006.
Great Offshore close to acquiring Scandinavian co for $ 500 mln
Vijay Sheth-promoted Great Offshore (GOL) is close to taking over a Scandinavian offshore company for around $ 500 million. The move, which comes close on the heels of his takeover of GOL from his cousins a month ago, is aimed at making the company an international player in the offshore space.
The cross-border deal, being co-ordinated by Motilal Oswal, is expected to close in 2-3 weeks.
"It's inappropriate to talk about it now," Mr Sheth told ET, adding that his company had not taken any final decision on any acquisition. Sources close to the deal said the Scandinavian company owns two jack-up rigs and that GOL is in the final stages of due diligence. Great Offshore shares rose 0.41% to Rs 790.45 on BSE on Tuesday. The shares have lost 0.8% over the week and 4.7% over the month.
GOL was created by demerging the offshore division of Great Eastern Shipping Company (GE Shipping), India's largest private shipping company, following a long family feud.
The GOL board, which met on July 30, discussed various fund-raising options ahead of the takeover. The sources said the boad has cleared a proposal to issue foreign currency convertible bonds (FCCBs) worth million.
GOL has also increased the FII investment limit from 24% to 49%. For this, the company could take the portfolio investment route or any other permissible mode. GOL recently issued 1.5 million redeemable optionally-convertible preference shares into equity at Rs 875 to the Exim Bank of India for about Rs 130 crore. A couple of weeks ago, the Carlyle group had picked up around 5% stake in GOL for around Rs 165 crore.
The global offshore services sector has seen a boom, thanks to soaring oil prices and the expanding exploration and production budgets of the oil giants. High prices are luring oil companies into stepping up the search for oil and gas across the world's oceans, thereby benefiting offshore supply companies.
In India, many local companies, including GE Shipping, Essar Shipping, Mercator Lines and Varun Shipping, are expanding their offshore/rig fleets to cash in on the boom. Charter rates of offshore/platform supply vessels and jack-up rigs have shot up over 100% in one year as demand largely outstripped supply.
The boom has led to a strong consolidation wave in the international market. For instance, last month, offshore drilling contractors, Transocean and GlobalSantaFe Corp, announced a mega merger to create a company with a full range of offshore drilling services.
The estimated enterprise value of the combined company would be around billion. Transocean, which is the world's largest offshore drilling contractor, was formed in recent history through a merger of Sedco Forex and Transocean in 2000 while GlobalSantaFe is the successor to two companies, Global Marine and Santa Fe International, which merged in November 2001.
For GOL, fleet expansion has been a top priority, as many contracts are waiting to be grabbed in India's fast-growing gas/oil exploration sector. GOL recently bagged a major 5-year contract early July from the state-owned ONGC. The contract, which is slated to commence from May 2009, is valued at around Rs 1,000 crore.
A Mumbai-based analyst said GOL is cash-rich, and that it can easily leverage its balance sheet for the acquisition. "The company is sitting over Rs 500-600 crore cash reserves, and is creating over Rs 150 crore every quarter. Of the $ 500 million deal, a major share of around $ 420 million will be debt," said sources.
Earlier, Chennai-based Aban Offshore had bought a Norwegian drilling company Sinvest, using a Singapore subsidiary. It paid $ 446 million initially for around 34% stake, and subsequently bought out 100% stake and got it delisted, by shelling out a total of $ 1.3 billion. The acquisition had helped Aban to join the top league of international offshore rig operators.
GOL managing director Vijay Sheth, who holds around 20% equity, has made it clear that the company will look at inorganic growth to make it a global operator. Other stakeholders — LIC, GIC and other mutual funds — hold around 7% stake.
Partner may face $ 30 mln Hitch; Sony to file lawsuit against K Sera Sera & Eros
The recently released Salman Khan & Govinda starrer Partner seems to be heading for serious trouble. Co-produced by Eros and K Sera Sera, the movie has been accused of being a direct lift from the Will Smith starrer Hitch. The producers of Hitch, Will Smith's production house Overbrook Entertainment along with Sony Pictures Entertainment, are contemplating a $ 30-million suit against both the Indian producers. Senior officials of Sony Pictures said that they will probably move the court in the UK as both K Sera Sera and Eros are registered entities in the UK and the US.
James Lassiter, partner, Overbrook Entertainment, told , "We are looking into the matter and consulting Sony Pictures on how to take the matter forward." The aggressive move stems from the fact that Sony Pictures is all set to debut in Bollywood and is planning to reproduce some of its Hollywood flicks in Hindi and other regional languages.
However, when contacted Sunil Lulla, managing director, Eros International, he said, "We have no idea about this development and I have not seen Hitch to remake it into Partner." Moreover, Sony Pictures is also looking at adapting some of its own formats to Indian sensibilities.
Insiders also revealed that they have realised that the Bollywood overseas market is significant, and if money is being made, they would want a piece of the pie. This is not the first time, one has heard of Indian films lifting the entire script from Hollywood flicks.
However, this is the first time that an international film company has decided to take legal action against an Indian entertainment company for plagiarism. In a sense, this also shows Bollywood's growing importance, with foreign entertainment companies looking at entering the Hindi movie space and taking notice of Bollywood content.
With Walt Disney, Viacom and Sony Pictures eyeing to grab a share of Bollywood, copyright infringement will no longer remain a dormant subject. Indian filmmakers will now have to tread carefully in terms of how they whip up content as foreign entertainment companies will rightfully claim a share of the profits on the back of copyright fees.
State Bank of India, the country's largest bank, is raising the bar for acquisition. Having tasted minor success with small buyouts, the public sector giant is ready with a $ 1 billion war chest to take over a niche bank which not just gives it access to foreign markets but also helps it blunt the advantage of international players who are poised to enter India in 2009. "We have been acquiring smaller banks and need to have a bigger bank in niche markets like derivatives," said a bank official.
While SBI is eyeing over 20% growth in the domestic market, it has also set sights on increasing the share of international banking in its portfolio. Though organic expansion through a deeper branch presence is one of the routes being pursued in markets like the US, bank executives said India's largest commercial bank would not shy away from acquistions even in Europe.
But given the valuations, even a $ 1 billion acquisition in Europe or in Asia would be small, considering the scale of operations. The government too wants India's state-run banks to increase their balance sheet size and was earlier toying with the idea of merging some entities. Though it had to give up its plans due to political opposition at home, it is egging them on to acquire global footprint and muscle.
"The size of the bank and what we finally acquire depends on the choice on the table. But the idea for niche acquisitions is to shorten the learning curve," a bank official said. With a bank, which has a strong derivatives trading platform in the kitty, SBI can hope to offer more specialised service to its clients at home who would otherwise shift to a Citibank or Barclays once India opens its doors to more foreign banks from April 2009.
SBI's acquisitions so far have been restricted to banks like like Giro Commercial in Kenya, Indian Ocean International Bank in Mauritius and PT Bank IndoMonex in Indonesia which were more to establish footprints in these markets.
State Bank has been talking of acquiring a bank in Bangladesh for a while but the move has not fructified yet. While the bank had made its intention of raising its acquisition size from under million so far to 0 million last year, the fresh target is a significant step up and is being seen as preparation for facing competition in the liberlalised era.
Even smaller public sector players like Bank of India have spent more on overseas acquisitions.
Blackstone set to invest $ 100 mln in Gokaldas Exports
Blackstone Group, a global private equity fund with $ 85 billion assets under management, is close to investing $ 100 million in publicly listed Gokaldas Exports, one of India's largest apparel exporters, reports the Business Standard. According to market information, Blackstone is likely to pick up 10-15% stake for this investment to fuel Gokaldas' expansion. A company spokesperson declined to comment on this development. If this investment sails through, it is expected to be one of the largest private investment in a public enterprise (PIPE) in the apparel sector.
Gokaldas is a Rs 1,000 crore apparel exporter, which is looking at tapping into the domestic Indian market as the rising rupee is hitting exporters hard. The majority of this sum is expected to be used to fund its 400-acre, Rs 2,000 crore-special economic zone at Kanakapura, on the outskirts of Bangalore. A spokesperson said they were going through the process of getting approvals for this project, which is expected in the current financial year.
Gokaldas Exports operates through 46 factories in south India, predominantly in Karnataka. During 2006-07, it commissioned two new factories in Mysore and Tumkur and a Rs 15 crore plant will come up in Hyderabad in a few months.
The company currently has an annual capacity to stitch out 30 million garments such as outerwear, innerwear, bottoms, shirts, knitwear etc. Globally, it supplies to companies like Nike, Adidas, GAP, Tommy Hilfiger and Abercrombie and Fitch.
According to a company official, Gokaldas is keenly looking at the retail scene panning out in India and is hoping to leverage this boom. "The domestic market growth is quite promising and a few well-known players have been added to our list of buyers. We expect a good growth in the domestic market and with the entry of bigger retail players, we expect a larger growth and activity in the Indian retail scene," the official said.
The local market currently accounts for 5% of the total sales and this is expected to double in the coming years. According to Gokaldas, it is expecting a top line growth of 15% during FY08. The company is one of the largest employers in India employing close to 60,000 people.
L&T, Essar, Korean major STX keen on setting up shipyards
Indian shipping industry is set witness a lot of action. Shipping biggies like L&T, Korean major STX, Essar, Shapoorji Pallonji and Bharti Shipyard are keen on setting up two mega shippyards at a total cost of over $ 1.5 billion.
The shipyards, both on west and east coast, will entail a minimum investment of Rs 3,000 crore for each shipyard. Sources said L&T and STX have sought to build both the shipyards. Thus, if L&T gets both the shipyards, the comapny will have to meet the project cost of Rs 6,000 crore.
"A single shipyard can handle around 2 lakh dead weight tonnage which is the international standard. Japan and Korea are well equipped to handle such tonnage," a government official said. The sites identified by the shipping ministry are Kakinada, Ennore and Tuticorn on the east coast and Mundra and Pipavav on the west coast.
L&T senior executive vice-president MV Kotwal said: " We have shorlisted three locations. We would first set up a shipyard at one of these. In future, we may take up other also. For that matter only we have sent expression of interst to the government."
Energy and commodity sectors are going to fuel the growth in the ship-building industry of the country. The ship-building industry is soon expected to witness boom period as immense growth is happening in the oil and power sector.
"As the refining capacity in the countries increases the demand for crude oil will go up, leading to increased demand for tankers. More and more power generation capacity is being created, particularly thermal power, which will require more coal. As Indian coal has more ash content, coal will be imported in huge quantities, which will require more ships," said a shipping industry analyst.
To bring India at par with Korea and Japan will be a hard task for the government. "If Indian companies ally with Korean, Japanese or other technologically-strong companies, then India may be able to compete with Korea and Japan in the long run," added the analyst.
Ceat to move plant out of city; unlock 31 acres of land in Bhandup
It would be one of the last industrial units to shift out of the clogged metropolis of Mumbai. Leading tyre maker Ceat, an RPG group company, is moving out lock, stock and barrel to Patalganga, around 60 km away from Thane in Maharashtra.
This would involve relocating a 3,000-strong workforce, with the company planning to sell off the existing 31 acres of factory land in the Mumbai suburb of Bhandup.
The 49-year old plant, with a capacity of 250 tonnes a day, will be dismantled and moved to Patalganga in phases without disturbing production significantly. Senior Ceat officials said a part of the plant may be shifted to its Nashik facility, where capacity is being augmented to feed growing demand.
Ceat MD Paras Chowdhury confirmed to ET that the company has shortlisted Patalganga for the plant. "We need around 60 acres of land and want to buy it from MIDC. The process is currently on. A deal with MIDC helps us immensely, since it provides all kinds of infrastructure and utilities, making land acquisition easier," he said.
In the first year at Patalganga, Ceat will set up a greenfield facility for truck and bus radials, which would be later used to produce car & tractor and specialty tyres such as off-roads and mining tyres with an estimated cost of Rs 500-600 crore. The project will keep pace with the ever-increasing demand from original equipment manufacturers (OEMs).
The Ceat move is expected to bring windfall gains for RPG group. The Bhandup plant annually pays around Rs 12-13 crore to the municipal corporation as octroi. Savings would be substantial, given that the company posted Rs 39 crore profit the last fiscal, on the back of a total income of Rs 2,135 crore. During the first quarter of the current financial year, it posted a profit of Rs 30 crore on the back of Rs 540-crore income.
Company officials cite other reasons too for the relocation. "It makes no sense to lock up expensive land. Around 31 acres of land would fetch around Rs 500 crore at the current market rate. The company is in the process of selling 6.5 acres for which many property developers have queued up."
Over the last few years, capacity addition at the plant had been restricted due to space constraints. "Trucks face many parking issues. Almost every industry has moved out and residential complexes are coming up all over the place," said the official.
Michael Lewis, a worker at Ceat Tyres and a top official of the Citu-affiliated Mumbai Shramik Sangh (MSS) said the company has been facing the ire of local residents. "Earlier, Bhandup was part of an industrial belt, but it is now a residential area. Though the company is steadily replacing its old machinery, some amount of carbon emission and air pollution is unavoidable," said Mr Lewis.
Being a labour-intensive industry, the shift may not be a cakewalk for the management. "It is the reality of life. The company has to shift out tomorrow, if not today. We are only trying to protect the company and its employees," said Mr Chowdhury.
Ceat would love to retain and accommodate its entire workforce, said an official. "We are shifting a running plant and have to ramp up capacity in no time. Hence, we do not have the luxury of training new workers," he added. Since the company is going to celebrate its golden jubilee next year, there are many workers who are close to retirement age.
"Around 100-150 workers are routinely retired every year," the official said. Ceat may also look at announcing a VRS for those who do not want to relocate. On Monday, Ceat shares ended at Rs 166 on BSE, marginally down from the previous close of Rs 169.20. It has shown a steady growth from Rs 78, the 52-week low touched on August 7, 2006.
Great Offshore close to acquiring Scandinavian co for $ 500 mln
Vijay Sheth-promoted Great Offshore (GOL) is close to taking over a Scandinavian offshore company for around $ 500 million. The move, which comes close on the heels of his takeover of GOL from his cousins a month ago, is aimed at making the company an international player in the offshore space.
The cross-border deal, being co-ordinated by Motilal Oswal, is expected to close in 2-3 weeks.
"It's inappropriate to talk about it now," Mr Sheth told ET, adding that his company had not taken any final decision on any acquisition. Sources close to the deal said the Scandinavian company owns two jack-up rigs and that GOL is in the final stages of due diligence. Great Offshore shares rose 0.41% to Rs 790.45 on BSE on Tuesday. The shares have lost 0.8% over the week and 4.7% over the month.
GOL was created by demerging the offshore division of Great Eastern Shipping Company (GE Shipping), India's largest private shipping company, following a long family feud.
The GOL board, which met on July 30, discussed various fund-raising options ahead of the takeover. The sources said the boad has cleared a proposal to issue foreign currency convertible bonds (FCCBs) worth million.
GOL has also increased the FII investment limit from 24% to 49%. For this, the company could take the portfolio investment route or any other permissible mode. GOL recently issued 1.5 million redeemable optionally-convertible preference shares into equity at Rs 875 to the Exim Bank of India for about Rs 130 crore. A couple of weeks ago, the Carlyle group had picked up around 5% stake in GOL for around Rs 165 crore.
The global offshore services sector has seen a boom, thanks to soaring oil prices and the expanding exploration and production budgets of the oil giants. High prices are luring oil companies into stepping up the search for oil and gas across the world's oceans, thereby benefiting offshore supply companies.
In India, many local companies, including GE Shipping, Essar Shipping, Mercator Lines and Varun Shipping, are expanding their offshore/rig fleets to cash in on the boom. Charter rates of offshore/platform supply vessels and jack-up rigs have shot up over 100% in one year as demand largely outstripped supply.
The boom has led to a strong consolidation wave in the international market. For instance, last month, offshore drilling contractors, Transocean and GlobalSantaFe Corp, announced a mega merger to create a company with a full range of offshore drilling services.
The estimated enterprise value of the combined company would be around billion. Transocean, which is the world's largest offshore drilling contractor, was formed in recent history through a merger of Sedco Forex and Transocean in 2000 while GlobalSantaFe is the successor to two companies, Global Marine and Santa Fe International, which merged in November 2001.
For GOL, fleet expansion has been a top priority, as many contracts are waiting to be grabbed in India's fast-growing gas/oil exploration sector. GOL recently bagged a major 5-year contract early July from the state-owned ONGC. The contract, which is slated to commence from May 2009, is valued at around Rs 1,000 crore.
A Mumbai-based analyst said GOL is cash-rich, and that it can easily leverage its balance sheet for the acquisition. "The company is sitting over Rs 500-600 crore cash reserves, and is creating over Rs 150 crore every quarter. Of the $ 500 million deal, a major share of around $ 420 million will be debt," said sources.
Earlier, Chennai-based Aban Offshore had bought a Norwegian drilling company Sinvest, using a Singapore subsidiary. It paid $ 446 million initially for around 34% stake, and subsequently bought out 100% stake and got it delisted, by shelling out a total of $ 1.3 billion. The acquisition had helped Aban to join the top league of international offshore rig operators.
GOL managing director Vijay Sheth, who holds around 20% equity, has made it clear that the company will look at inorganic growth to make it a global operator. Other stakeholders — LIC, GIC and other mutual funds — hold around 7% stake.
Partner may face $ 30 mln Hitch; Sony to file lawsuit against K Sera Sera & Eros
The recently released Salman Khan & Govinda starrer Partner seems to be heading for serious trouble. Co-produced by Eros and K Sera Sera, the movie has been accused of being a direct lift from the Will Smith starrer Hitch. The producers of Hitch, Will Smith's production house Overbrook Entertainment along with Sony Pictures Entertainment, are contemplating a $ 30-million suit against both the Indian producers. Senior officials of Sony Pictures said that they will probably move the court in the UK as both K Sera Sera and Eros are registered entities in the UK and the US.
James Lassiter, partner, Overbrook Entertainment, told , "We are looking into the matter and consulting Sony Pictures on how to take the matter forward." The aggressive move stems from the fact that Sony Pictures is all set to debut in Bollywood and is planning to reproduce some of its Hollywood flicks in Hindi and other regional languages.
However, when contacted Sunil Lulla, managing director, Eros International, he said, "We have no idea about this development and I have not seen Hitch to remake it into Partner." Moreover, Sony Pictures is also looking at adapting some of its own formats to Indian sensibilities.
Insiders also revealed that they have realised that the Bollywood overseas market is significant, and if money is being made, they would want a piece of the pie. This is not the first time, one has heard of Indian films lifting the entire script from Hollywood flicks.
However, this is the first time that an international film company has decided to take legal action against an Indian entertainment company for plagiarism. In a sense, this also shows Bollywood's growing importance, with foreign entertainment companies looking at entering the Hindi movie space and taking notice of Bollywood content.
With Walt Disney, Viacom and Sony Pictures eyeing to grab a share of Bollywood, copyright infringement will no longer remain a dormant subject. Indian filmmakers will now have to tread carefully in terms of how they whip up content as foreign entertainment companies will rightfully claim a share of the profits on the back of copyright fees.
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